Telomeres are structures on the ends of linear chromosomes that are required for genome stability. They serve at least two essential functions: to counterbalance the loss of DNA from a chromosome end due to the inability of DNA polymerase to replicate chromosome ends completely, and to distinguish a natural chromosome end from a broken chromosome end. Telomeres are complex, having a tandem array at the end that appears to be important for both of these functions, a more complex array of repeats of unknown function proximally, and proteins that bind to these DNA repeats. The subtelomeric repeats are thought to be associated with the formation of heterochromatin and the inactivation of genes placed in their vicinity, and may be instrumental in forming associations with other telomeres, the nuclear matrix and the lamina. Reporter genes placed in subtelomeric repeats variegate, that is they are expressed in some cells of the appropriate tissue, but not others. The subtelomeric repeats from chromosome 2L have been ligated to a reporter gene and reintroduced into the genome to ask whether, and under what circumstances, this repeated sequence reduces gene activity. Transcription is reduced when the repeat is attached upstream of the reporter in one orientation, but not the other. Partial deletion of the array partially restores gene activity. Thus, this repeat array reduces transcription and may be important for telomeric heterochromatin formation. Other components of the telomere are now being tested for the ability to modulate the effect of this subtelomeric repeat on gene expression.